The Federal Government has perfected plans to attract $10 billion in new investments in deep-water gas exploration through tax breaks and other incentives.
In the new policy framework forwarded to the National Assembly to be passed into law, the Federal Executive Council (FEC) said about 67% of Nigeria’s offshore gas sector remains undeveloped.
However, the FEC believes that by providing tax credits for new investments in the sector, more global players can be lured to the untapped sector.
In a statement published by Olu Verheijen, special adviser to the president, the government also plans a gas-production allowance for greenfield developments in onshore and shallow-water locations.
“We intend to unlock between $5 billion to $10 billion of new investments in Nigeria in the near- to medium-term,” Verheijen said.
According to Verheijen, who also heads the Energy Office of the Presidency, once this is passed into, it would fast-track the development of natural gas, deepen gas usage for transportation and bolster energy security.
It was estimated that global businesses will be spending about $90 billion on deep-water oil and gas projects in coming years, this, Verheijen said is what the country is targeting.
“This is the pool of funds that our reforms are targeting,” she said.
The president has implemented a series of reforms to rejig the nation’s economy and set Nigeria on the right path. In a recent broadcast, the president claimed these reforms have attracted over $30 billion in foreign direct investment.
Despite the changes made to core policies, Nigerians are yet to see its results as earnings remained low and inflation rate remained at an all-time high while economic uncertainties in the face of chronic Naira depreciation have eroded the profitability of businesses.